## Facts

- Landlords owned improved commercial property on Liberty Street in Baltimore and leased it to a jewelry company under seal for five years ending November 4, 1927.
- Rent increased during the final two years to $7,000 per year, payable monthly in equal installments.
- The lease included covenants (1) to vacate at the end of the term and (2) to be liable for all loss or damage the landlords suffered from failure to leave, including loss of sale or lease.
- Before expiration, the parties discussed a new long-term lease but did not reach agreement; the tenant also requested a possible short extension, but the landlords’ authorized agent would not agree to less than six months and negotiations ended without any extension contract.
- The tenant did not surrender possession when the term ended and remained in possession briefly after November 4, 1927, then vacated.
- After vacating, the tenant tendered a check equal to one month’s rent under the expired lease; the landlords refused to accept it except as the first month’s rent of a claimed one-year term.
- The landlords were unable to relet the property until January 1929 and sued to recover rent-based losses; the trial court awarded $6,416.67 to the landlords.

## Issues

1. Whether a commercial tenant’s wrongful holding over after a fixed-term lease expires can subject the tenant to year-to-year liability or rent-based damages measured by the expired lease.
2. Whether express covenants to vacate and to pay “all loss or damage” from failure to leave permit recovery for the landlord’s inability to relet after the tenant vacates.
3. Whether the landlords’ refusal to accept a post-vacancy payment except as rent for a one-year term created a new consensual lease or instead left the tenant liable in damages for breach and holdover.

## Decision

- The appellate court affirmed the judgment for the landlords.
- The court held that no new lease or extension was formed during negotiations; the original lease fixed the end date and governing obligations.
- The tenant’s failure to surrender possession at term end breached the covenant to vacate and triggered liability under the covenant to pay losses caused by failing to leave.
- The landlords could recover losses attributable to the holdover and resulting inability to relet, with the reserved rent serving as the measure of damages for the loss period proven.
- The exchange concerning the one-month check did not establish a new one-year lease by consent.

## Legal Principles

- A tenant who wrongfully holds over after expiration of a fixed-term commercial lease may incur liability measured by the rental terms of the expired lease, including liability treated in practice as year-to-year responsibility where applicable.
- Express lease covenants requiring surrender at term end and requiring payment of “all loss or damage” from failure to vacate are enforceable, and may support recovery for lost leasing opportunities caused by the holdover.
- In assessing damages for wrongful holding over and breach of a surrender covenant, the contract rent may be used as a reasonable yardstick for the landlord’s loss until reletting occurs or the loss period otherwise ends.
- Unaccepted tender of partial rent, and a landlord’s conditional willingness to accept it only on terms the tenant does not accept, does not by itself create a new lease by agreement.

## Conclusion

The court affirmed an award to the landlords because the tenant’s brief holdover breached covenants to vacate and to compensate for resulting losses, allowing damages measured by the reserved rent for the period the landlords were deprived of a reletting opportunity.


A.H. Fetting Mfg. Jewelry Co. v. Waltz, 160 Md. 50, 152 A. 434 (Md. 1930)